Question

3 Knowledge Check 01 The journal entry to record annual depreciation for equipment includes a: + 2 of 9 Multiple Choice 0.43 nts awarded debit to Accumulated Depreciation Scored debit to Depreciation Expense credit to Equipment credit to Cash
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Answer 1

(1) The journal entry to record annual depreciation:
Answer:-
(b) debit to depreciation expense

Particulars	Debit	Credit
Depreciation A/C	xxxx
To Accumulated Depreciation		xxxx
To record annual depreciation expense

Debit to Depreciation expense and Credit to Accumulated Depreciation.

(2)
Answer:-
(d) Asset turnover is 2.2 times for Gordon and 3.1 times for Jordan. Thus Jordan generates more sales per dollar of assets than does Gordon.

Average fixed assets of Gordon Inc. = (Beginning total assets + Ending total assets) / 2
= (1,420 + 1,600) / 2
= 1,510
Average fixed assets of Jordan Inc. = (Beginning total assets + Ending total assets) / 2
= (2,230 + 2,020) / 2
= 2,125

Assets Turnover of Gordon Inc. = Net Sales / Average fixed assets of Gordon Inc.
= 3,280 / 1,510
= 2.17
Assets Turnover of Jordan Inc. = Net Sales / Average fixed assets of Gordon Inc.
= 6,540 / 2,125
= 2.17
= 3.077